Where Does The Wage Penalty Bite?

Executive Summary

The literature examining the relationship between Body Mass Index (BMI) and wages has fairly consistently found that BMI has a negative impact on earnings for women, and less (if any) consequences for men. In this paper, the authors relax the assumption - largely unquestioned in this research - that the conditional mean of wages is linear or piecewise linear in Body Mass Index (BMI). Using data from the 1986 and 1999-2005 Panel Study of Income Dynamics, they estimate semi-parametric wage models that allow earnings to vary with BMI in a highly flexible manner. For women, the results show that earnings peak at levels far below the clinical threshold of "Obesity" or even "Overweight".